Economic woes continue to drag FTSE down

The London market suffered a third straight day of punishment today as economic fears remained the main influence over trading.

The London market suffered a third straight day of punishment today as economic fears remained the main influence over trading.

Banks were among the main casualties as the prospect of recession failed to go away, while more losses for miners also weighed on the top flight.

The FTSE 100 Index was down more than 1%, or 71.1 to 5291 by mid-morning. Yesterday the top flight closed off 137.6 points, following a fall of 2% on Wednesday, after forecasts of lower growth in the euro zone and downbeat data in the United States.

Today’s drop mirrored similar falls across Europe, with Germany and France’s main exchanges also 1% lower.

In London, Barclays shed 12.75p to 316.5p and Royal Bank of Scotland fell 7.5p to 220.25p. HBOS was also 2% down, or 6.25p to 276.25.

Broadcaster ITV, which has been plagued by the gloomy advertising outlook amid the worsening economy, saw shares fall 1.6p to 41.9p.

Supermarket chain Sainsbury’s was another big faller – down 10.75p at 336.75p - as takeover speculation surrounding the group began to fade.

Among the big miners on weaker ground was Ferrexpo, which has topped the fallers board for the past three days. Shares were down 18.5p to 179.5p.

The market woes also saw an end to Flora-to-Persil group Unilever’s strong run after Thursday’s well-received appointment of Nestle’s Paul Polman as chief executive. Shares opened on the front foot, but fell back 10p to 1571p.

In today’s corporate news, pubs chain JD Wetherspoon managed to put on 1.25p to 262p despite saying it would need to grow like-for-like sales by 3% in order to maintain its profits performance in this financial year.

Music, games and books retailer HMV was also down 2.75p at 129p after it reported a 1.3% rise in like-for-like sales, a performance impacted by a weaker trend at book shop chain Waterstone’s.

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